Preferential Procurement

Original publish date – Mon, 27 Jul 2009 12:41:14 +0000, patience

Preferential procurement encourages procurement opportunities to be made available to B-BBEE compliant suppliers. It is the immediate reason for companies and government entities to request B-BBEE scorecards from suppliers and potential suppliers and the B-BBEE cascading effect begins with preferential procurement. The self-regulation of B-BBEE is also centered on this element.

Companies can easily earn and continuously improve their points by preferring to procure from B-BBEE compliant suppliers. However in most cases earning points and calculating the preferential procurement score can be an administration irritation. A quick look at the top 200-empowerment companies on the JSE shows that only 1 company out of the 200 companies earned all the maximum 20 points on Preferential Procurement. According to President Zuma’s recent comments on B-BBEE “Access to government procurement opportunities by black firms has been raised as a serious challenge.” This undoubtedly is happening because enterprises and government departments do not have an understanding of Preferential Procurement and also do not have the proper systems in place.

With an understanding of preferential procurement and a system aligned to BEE initiatives, private companies and government entities can begin the kazien or improvement of preferential procurement and the procurement points. Our upcoming Procurement and Enterprise Development Conference can definitely help you in understanding preferential procurement, overcome the administration irritation and ultimately improve your B-BBEE points.

 

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